SIEMENS

Cities have been the key element of human civilization for thousands of years. Whether we look at Mesopotamia, the Roman Empire, ancient Egypt or China – cities have always been the epitome of culture, trade, art, craftsmanship, and human progress. But a lot has changed since ancient times. A mere 200 years ago only three percent of the world’s population lived in urban areas. Today more than half of the world’s people – over 3.5 billion – live in cities.

Around 50 percent of global economic output is now generated by the world’s 600 largest metropolitan areas. Likewise, cities account for around two thirds of worldwide energy consumption and up to 70 percent of greenhouse gas emissions, despite covering a mere two percent of the earth’s surface.

That’s why we must first look at our cities as we begin to look for solutions to the most pressing problems of our time, including, most particularly, climate change and the increasing scarcity of natural resources. Given the high population density of urban areas, there is tremendous potential here for boosting efficiency in areas such as power generation, distribution, and utilization in buildings and transportation systems. In other words, the key to humanity’s future will be found exactly where civilization began: in cities.

The good news is that many urban areas are facing up to this responsibility and taking measures to reduce their environmental footprint. Leading the way are Copenhagen and Melbourne. The Danish capital is aiming to completely eliminate its net CO₂ emissions by 2025, and Australia’s second-largest city is looking to reach the same target as early as 2020. The following examples illustrate the kinds of measures that can be implemented in order to achieve this goal.

Clean Power. Siemens estimates that global demand for electricity will rise by around two thirds between now and 2030. Power plants with a combined generating capacity of around 7,000 gigawatts (GW) are slated for construction over that period. Over one third of these plants will use renewable, carbon-free sources of energy such as wind, hydro, and solar. However, around 45 percent of this generating capacity will still be supplied by power plants burning fossil fuels such as coal and gas. In other words, the next 20 years could well see an increase of around 50 percent in fossil-fuel generation. This primarily applies to Asia and the U.S., as both of them are now turning to highly efficient gas-fired power plants, some of which feature technology from Siemens.

Coal-fired generation of electricity, particularly by existing plants, will also remain a key player in the global power industry in the years to come. The past five years have seen the construction of advanced coal-fired power plants with a combined generating capacity of over 350 GW. Yet total coal-fired generating capacity worldwide, which amounts to more than 1,600 GW, is supplied primarily by older plants. In Russia, for example, over 80 percent of the coal-fired power plants are more than 20 years old, and some of them have an efficiency level of only 23 percent. This means that they produce twice as much CO₂ per kilowatt-hour as a state-of-the-art power plant with an efficiency of over 45 percent.

Worldwide, there are hundreds of fossil-fuel power plants whose efficiency could be boosted by several percentage points through modernization. This would significantly reduce their CO₂ emissions and thereby aid climate protection. In addition, modernization would also cut their operating costs as well as increasing their service life, their output, and their overall competitiveness. “In the U.S. alone, upgrades of more than 100 steam turbines since the year 2000 have reduced CO₂ emissions by over 20 million metric tons a year,” reports Steve Welhoelter, who coordinates service activities for Siemens Energy worldwide from his base in Orlando, Florida.

Another factor that is crucial to clean power generation is greater use of renewable energy. In Turkey, for example, the population is forecast to grow from 75 million people to around 95 million between now and 2050. At the same time, the country’s energy use is expected to increase enormously. To reduce its dependence on imports of natural gas, the country plans to restructure its power industry and, in particular, promote the use of locally-available sources of energy such as wind. In the period since 2008, Turkey’s total wind-generating capacity has risen tenfold to 3.5 GW.

Low-loss Distribution. Yet increased use of renewable energy will also pose its own challenge to power grids around the world. Unlike conventional generating capacity, which tends to be located close to the centers of demand, plants using renewables are built precisely where these alternative sources of energy occur in abundance. That means solar plants are built in sunny regions and wind farms are on high ground or offshore. This requires the construction of additional long-distance power transmission lines.

In China, for example, Siemens has installed the technology for a high-voltage direct-current (HVDC) transmission line that carries carbon-free hydroelectric power over 1,500 kilometers to the eastern coast at a loss of only a few percent. The use of conventional alternating-current lines would have resulted in transmission losses that would have been two to three times higher.

Similar HVDC systems from Siemens are also under construction in other countries, including transmission lines between England and Scotland as well as between Spain and France. Other projects that are under way include a Siemens transmission line in India, where the poor quality of the power grid means that electricity often does not reach the consumers who need it. Linking the towns of Mundra and Mahendragarh, which are located some 1,000 kilometers apart, this virtually loss-free line is the first of its kind to be certified as a green technology according to the United Nations Framework Convention on Climate Change (UNFCCC). It carries enough power to supply over one million Indian households.

Optimized Energy Use. Yet the most reliable and environmentally friendly way of ensuring an adequate supply of energy is to reduce consumption. In cities, this applies particularly to buildings, which account for 40 percent of worldwide energy consumption and are responsible for about 20 percent of all greenhouse gas emissions through their utilization of power and heat. The implementation of the most energy-efficient lighting, air conditioning, IT, and safety systems would make it relatively easy to reduce demand by 30 to 40 percent.

Industrial facilities are another major energy consumer. Here too, the implementation of intelligent solutions to cut demand is crucial, largely because such measures result in major savings in view of rising energy prices and thereby boost a company’s competitiveness. Take the automobile industry, for example. One of its prime goals is to trim its plants’ base load, as Rudolf Traxler, who is responsible for energy management systems at Siemens Industry in Linz, Austria, explains: “Even at times when there is little or no production, energy demand is often 30 percent as high as on a normal working day.” Cutting-edge energy management systems from Siemens that incorporate a host of sensors provide a clearer picture of energy demand and indicate where savings can be made. At BMW’s engine plant in Steyr, Austria, for example, the base load during downtime has been reduced from eight to five megawatts.

All of these examples show that with today’s technology there are already numerous options available for achieving significant reductions in energy demand and CO₂ emissions. The latest climate report from the United Nations Environment Programme (UNEP) reveals that global emissions of greenhouse gases have risen by around 20 percent since 2000. Nevertheless, as UNEP Executive Director Achim Steiner demonstrated at COP18, the UN Climate Change Conference in Qatar at the end of 2012, decisive action can still make all the difference on the international level: “Who would have thought back in 2006 that we would be able to increase the share of renewable energy worldwide from just below four percent then to the current level of 20 percent?”

The key to such progress is that countries, cities, and industries can bring climate protection into line with their own best interests. It’s a strategy that Siemens has pursued with great success for many years. Sales of the highly efficient technology and solutions from its Environmental Portfolio totaled €33.2 billion in fiscal year 2012. Thanks to such technology, Siemens customers were able to cut their CO₂ emissions by around 332 million metric tons over the same period. That corresponds to approximately 41 percent of the total CO₂ emissions of the Federal Republic of Germany in calendar year 2010.

In other words, this achievement is yet another example of how sustainability in business can pay off in terms of both the environment and economics. Yet a key challenge still remains. Given the rapid growth of the world’s population, its prosperity, and its demand for natural resources, will we be able to shape the 21st century in a sustainable manner? It is primarily our cities that must provide an answer to this question. And the answer will determine whether cities can and will remain a shining example of human progress.